Correlation Between Boyd Gaming and Procter Gamble
Can any of the company-specific risk be diversified away by investing in both Boyd Gaming and Procter Gamble at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Boyd Gaming and Procter Gamble into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boyd Gaming and Procter Gamble, you can compare the effects of market volatilities on Boyd Gaming and Procter Gamble and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Boyd Gaming with a short position of Procter Gamble. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boyd Gaming and Procter Gamble.
Diversification Opportunities for Boyd Gaming and Procter Gamble
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Boyd and Procter is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Boyd Gaming and Procter Gamble in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Procter Gamble and Boyd Gaming is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Boyd Gaming are associated (or correlated) with Procter Gamble. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Procter Gamble has no effect on the direction of Boyd Gaming i.e., Boyd Gaming and Procter Gamble go up and down completely randomly.
Pair Corralation between Boyd Gaming and Procter Gamble
Considering the 90-day investment horizon Boyd Gaming is expected to generate 2.08 times more return on investment than Procter Gamble. However, Boyd Gaming is 2.08 times more volatile than Procter Gamble. It trades about 0.05 of its potential returns per unit of risk. Procter Gamble is currently generating about 0.08 per unit of risk. If you would invest 6,294 in Boyd Gaming on August 28, 2024 and sell it today you would earn a total of 1,005 from holding Boyd Gaming or generate 15.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boyd Gaming vs. Procter Gamble
Performance |
| Timeline |
| Boyd Gaming |
| Procter Gamble |
Boyd Gaming and Procter Gamble Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boyd Gaming and Procter Gamble
The main advantage of trading using opposite Boyd Gaming and Procter Gamble positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boyd Gaming position performs unexpectedly, Procter Gamble can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Procter Gamble will offset losses from the drop in Procter Gamble's long position.| Boyd Gaming vs. MGM Resorts International | Boyd Gaming vs. Las Vegas Sands | Boyd Gaming vs. Wynn Resorts Limited | Boyd Gaming vs. Penn National Gaming |
| Procter Gamble vs. Unilever PLC ADR | Procter Gamble vs. Estee Lauder Companies | Procter Gamble vs. ELF Beauty | Procter Gamble vs. Coty Inc |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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